Dinglis v Dinglis & Ors [2019] EWHC 1664 (Ch) (28 June 2019)

Dinglis v Dinglis & Ors [2019] EWHC 1664 (Ch) (28 June 2019)

The court found that Paul Dinglis was unfairly prejudiced as a minority shareholder by his exclusion from management and lack of access to information, and that certain payments initiated by Andreas constituted breaches of fiduciary duty or equitable understandings. The court determined that DPL operated as a quasi-partnership and that equitable constraints applied to Andreas' exercise of majority shareholder rights. An order for the purchase of Paul's shares was appropriate, with directions as to valuation date and minority discount to be determined.

Citation
[2019] EWHC 1664 (Ch)
Parties
Petitioner: Paul Dinglis; First Respondent: Andreas Dinglis; Second Respondent: Master Holdings Group Limited; Third Respondent: Dinglis Properties Limited
Jurisdiction
England and Wales
Judgment Date
28 June 2019
Procedural Posture
Petition Under Companies Act 2006 S.994 / First Trial on Unfair Prejudice and Share Purchase Order
Outcome
Petition upheld; unfair prejudice established; order for purchase of petitioner's shares granted
Legal Topics
Unfair Prejudice, Quasi Partnership, Minority Shareholder Rights, Breach of Fiduciary Duty, Share Purchase Order, Valuation Date, Minority Discount
Company Law Equity Insolvency Unfair Prejudice Quasi Partnership Minority Shareholder Rights Breach of Fiduciary Duty Share Purchase Order +2 more

Case Brief

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Parties

Paul Dinglis

Petitioner

Andreas Dinglis

First Respondent

Master Holdings Group Limited

Second Respondent

Dinglis Properties Limited

Third Respondent

Procedural Posture

Petition Under Companies Act 2006 S.994 / First Trial on Unfair Prejudice and Share Purchase Order

Legal Issues

  1. 1 Whether the petitioner was unfairly prejudiced as a minority shareholder by exclusion from management and lack of access to information
  2. 2 Whether breaches of fiduciary duty by Andreas occurred and caused unfair prejudice
  3. 3 Whether an order should be made for purchase of petitioner's shares, and if so, the date of valuation and whether a minority discount applies

Ratio Decidendi

The court found that Paul Dinglis was unfairly prejudiced as a minority shareholder by his exclusion from management and lack of access to information, and that certain payments initiated by Andreas constituted breaches of fiduciary duty or equitable understandings. The court determined that DPL operated as a quasi-partnership and that equitable constraints applied to Andreas' exercise of majority shareholder rights. An order for the purchase of Paul's shares was appropriate, with directions as to valuation date and minority discount to be determined.

Court Disposition

Petition upheld; unfair prejudice established; order for purchase of petitioner's shares granted

Orders

  • Order for purchase of Paul's 12% shareholding in Dinglis Properties Limited by Andreas Dinglis and/or Master Holdings Group Limited
  • Directions to be given as to valuation date and minority discount